In this video I discuss some of the current problems in the housing market, and talk about some ways you can prepared for the eventual crash.
Transcript:
Chris Bounds 00:00
We’ve seen a few of these things. We don’t know if a recession is coming. And we don’t really know what’s going to happen going ahead. But you’ve been through a few turbulent times in the market before. What are your thoughts with what we maybe see over the next 12 to 24 months? What are you doing within your business or very close feet? Now, people who ask you this question, what do you kind of recommend in order for them to navigate this?
Russell Simmons 00:27
Okay, great, just to kind of get up to speed got in the business in 1976. So interest rates were 18%. So I’m not a guy that’s very rate sensitive. But as I’ve said many times before, I take what the market gives me. The 70s, were challenging, the 80s and you know, every decade since. But what I’m seeing now, the residential market is oversold, interest rates are creeping up.
So we’re kind of concerned about consumer confidence. When the consumer loses confidence, then real estate really changes. So the good thing that we’ve got going for us is we’re in Houston, Texas and everybody wants to be here. So I’m not panicking at the moment. But whenever I see something oversold or too challenging, or too many people changing the same thing, then I changed directions. So if residential is difficult, I go commercial.
Same goes when commercial gets too difficult. Then I go back to residential, or as you’ve heard me say many times before low hanging fruit, you know, the phone rings, the email comes across the desk. What’s the deal? It’s a good deal. Regardless, commercial country property, residential land, or whatever, you do the deal. I am concerned with the inflation. I’m concerned with the consumer confidence.
But not concerned enough to quit buying real estate. I mean, it might be a little bit of a slowdown. I mean, people are concerned, we came out of COVID, we’ve got the war. Right. Now, we’ve got so many things going on. And people think that they need to pull in a little bit. I understand. I don’t like to be too far over my skis. But when people lose confidence, that’s a great time to buy.
Chris Bounds 02:17
It definitely is. And you have a couple of different ways of looking at it. So you’re an investor. I mean, we I don’t know if you do currently, but you’ve worked with buyers and sellers out there as well. So it was during the investor, you’re able to be very nimble going from residential to commercial.
The landlord market. Everywhere, I really see it. It looks pretty promising because in the event that buyers pull out, what really I mean is that demand, it eases because of interest rates because of prices or whatever, they still gotta live somewhere, which means they’re gonna be renting. I mean, they’re either gonna be upgrading their current home, which that doesn’t change anything for landlords, or they’re going to continue renting, which I mean, if you’re a landlord that’s a good deal.